New York is rehearsing the abolition of the energy supplier

NThe Gowanus neighborhood in Brooklyn is touted to ew York visitors for a variety of reasons. “Cool art galleries and music clubs” replaced the “musty smell of the canal”, which gives the quarter its unmistakable scent. The mix of industrial buildings and simple row houses offers space for the creative scene, and the underground scene lives up to its name.

Andreas Mihm

Business correspondent for Austria, East-Central and Southeastern Europe and Turkey based in Vienna.

The energy industry thinks less of all this when it thinks about the up-and-coming Park Slope district in Gowanus. It’s because an experiment began there this spring that could revolutionize the energy industry. Along President Street, citizens on one side of the grayed-out row houses have been supplying residents on the other side with self-generated electricity since April. It comes from the solar panels on their roofs. So far none of this is revolutionary.

The alarm bells are ringing at electricity suppliers

What is new about the “Brooklyn Microgrid” is that they also handle billing and payment directly with one another, without an intermediary supplier. “The mechanism shows what the future of a decentralized electricity network that is self-administered in neighborhoods could look like,” analyzes the consulting firm PWC. What the consultants write down so soberly sets the alarm bells ringing for electricity suppliers. After all, who still needs your services when consumers and producers in the digitized electricity market do their business in a decentralized manner and alone with one another?

Only ten households are taking part in the New York model, but word of it has got around a lot. The parliamentary state secretary in the Federal Environment Ministry, Rita Schwarzelühr-Sutter (SPD), recently had the public electricity project explained to her on site. And in distant Germany, consumer advice centers are already thinking about who will be the winners and who will be the losers of the next stage of digitization.

“This will accelerate the structural change and bring new players onto the market,” says Udo Sieverding from the North Rhine-Westphalia consumer center. He adds: “Consumers can benefit from this competition: the classic customers in the electricity and gas market, but especially the prosumers who secure a piece of the pie as a provider of self-generated electricity.” In order to take stock, PWC examined the topic more closely for the consumer advice center.

The core of the New York “neighborhood network” is digital billing. It happens using a novel process called blockchain. Put simply, all data exchanged between the provider and the customer is encrypted and saved. In the case of new transactions, their data is added to the existing one and the data chains are lengthened. Since this data is only saved on the computers involved, it should be tamper-proof. Anyone who is authorized has access to it at any time; no one can claim that they have drawn less electricity or received less money than what was agreed.

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